In good company – a look at acquisitions from a CEO’s perspective

A conversation with IMS Group CEO Roy Langseth

Diving into the world of M&A can prove challenging for business-owners looking either to sell their company or make an acquisition to, for example, expand their geographical scope or product range. Where do you start looking for a buyer or seller? Should it be in the local area or further afield? And what happens after the deal is done?

Gaining insights from others who have gone through this process, sometimes several times, can provide assurance and inspiration to those considering taking this step. As such, we spoke to IMS Group CEO Roy Langseth about his extensive experience in this area to gather advice and suggestions about navigating M&A.

IMS Group is a family-owned marine technology company based in Norway. Over the past 15 years or so, IMS has acquired a number of firms as part of an ongoing growth strategy — its current aim is to become the best service provider for shipowners throughout the life cycle of their vessels.

Our conversation with Roy covered a range of topics such as refining the acquisition process, the value of a ‘magic phone call’, and what to focus on during the post-deal integration.

How would you describe IMS Group today?

We are a handful of individually run companies which are all in the marine business. We are producing our own products, we own the products, and we also focus on their life cycle. We saw that going from being just an equipment supplier to being a service provider for the whole life cycle of the vessel, that we got more continuous business. That has been very successful for us, and we’ve also managed to get through all the ups and downs in the marine industry.

What are your growth goals when seeking an acquisition target?

We are really looking for the perfect fit, where one plus one is more than two. Basically, our target is companies that are healthy, that have an R&D approach, are doing the engineering and the manufacturing, and own the products so they can take care of the life cycle business with the shipowner afterwards. Ideally we would find either products we can bundle in sales with products we already have, or we find, for example, a company that has not developed their aftermarkets particularly well, so we can start doing that.

What is your process for finding suitable targets?

The target in 2009 was to grow the company. We started to look into product development, but that takes years and years, and there wasn’t the patience for that, so we ended up looking for companies to buy. We bought a company that was for sale quite close to us, in Tvedestrand, TeamTec. It worked out pretty well, and we wanted to make a road map to go on buying companies but we realised it would be nice to speak to companies who do M&A professionally.

We interviewed three companies and ended up with Oaklins, based both on their profile and the size of companies they were working with, and their approach to how they would do the screening process. They did a very professional search and they also, together with us, did a long evaluation of what we are actually looking for and why the companies that we had bought in the past were a success.

Then Oaklins made us a catalog with 50 companies based in Norway, Sweden, Germany and UK. We went through these companies and evaluated them. First we found Jowa in Sweden, a very good match. But we tried for a year to buy it without luck. [Ultimately, IMS acquired it in April 2024.] Then we went for Baggerød in Norway, which is much closer, about a one-and-a-half hour drive from here.

After we did deals a couple of times, we wrote down the perfect fit, to specify that. So we are very clear now about looking for synergies, about what we have in the group, and what can we use if we find another case. The team at Oaklins know us very well and know exactly what would be a good fit for us. ROY LANGSETH, CEO, IMS GROUP, NORWAY

Apart from Europe, are there any other regions or countries of interest for seeking future targets?

I think it would depend on the company because what’s nice now is that we can travel quite quickly to most of the companies. So we can do a round trip within one week, and visit at least two of them and spend some time there. So that’s a benefit for us.

Could you describe a key turning point or pivotal moment in one of your recent acquisitions?

Deals are really like a fragile thing. If you work for hours and hours preparing a presentation and do it really well, but don’t follow up with that magic phone call afterwards and say you actually want to have the deal, then you sound uninterested or the sellers thinks you aren’t interested and all of a sudden it’s gone.

We had a deal where the owner was in one moment really keen to sell, and in the next moment not. I was advised not to call him at all, and just leave it to the people that knew him. He came around but he had to do it at his speed and he needed to hear the right words. And that is where I think cooperating with Oaklins works beautifully because sometimes you need somebody to say, “Roy, now I think you should call him and say this and this, because that is what he needs to hear right now. ROY LANGSETH, CEO, IMS GROUP, NORWAY

Can you discuss any challenges or obstacles faced during an acquisition process?

We had one that we tried but it didn’t work out, because the owner wasn’t really ready to sell. We made him an offer, and he didn’t respond, he wanted much more, and in the end, we concluded that he wasn’t ready to sell his company yet. So we just let him be and 10 years later, we closed the deal. He just needed some time! But we behaved well. We had made him an actual offer and when he turned us down, we weren’t impolite in any way, we just said “OK, tell us when you’re ready.” So we managed to get into that position through building a good relationship with the owner.

Could you describe your integration process following acquisitions?

Our plan is to keep running the companies as they are, improve them a bit and also see if we can use some of the technologies from the other companies or entities. The latest company we bought had a very good set-up, with an office in Greece and in Singapore, and a factory in China. They also had a sales hub in Holland and a store, so that is something that could be a benefit for the other companies.

We made a checklist, but it differs from case to case. And we found that we had to narrow it down to five things or so that are important to change within the first 100 days. We keep the list very short — it’s better to focus on the most important changes.

In what other ways has Oaklins helped you with your transactions?

I think one of the best things we have experienced with Oaklins is that we have worked together for so many years now, we know each other very well. So they know quickly when there’s a good deal for us. We’re not getting flooded with all sorts of stuff that isn’t interesting to us, because they know what we’re looking for.

Is there any other advice you’d give to companies looking to make an acquisition to support their growth strategy?

I think if you have a growth strategy, unless you are a company filled with brilliant engineers who can make new products really fast, then this is a very good way to grow. I’m always recommending that people go with a professional M&A company because to make a strategy, and know how you want to do it and what exactly you are looking for all makes such a big difference compared to just buying a company because it was suddenly for sale. ROY LANGSETH, CEO, IMS GROUP, NORWAY